Fca-renault Revival May Hinge On Willingness To Cut Nissan Stake

FCA-Renault revival may hinge on willingness to cut Nissan stake

Fiat Chrysler Automobiles and Renault are looking for ways to resuscitate their collapsed merger plan and secure the approval of the French carmaker's alliance partner Nissan, according to several sources close to the companies. Nissan is poised to urge Renault to significantly reduce its 43.4% stake in the Japanese company in return for supporting a FCA-Renault tie-up, two people with knowledge of its thinking also told Reuters. It is still far from clear whether any concerted effort to revive the complex and politically fraught deal can succeed. FCA Chairman John Elkann abruptly withdrew his $35 billion merger offer in the early hours of June 6 after the French government, Renault's biggest shareholder, blocked a vote by its board and demanded more time to win Nissan's backing. Nissan representatives had said they would abstain. The failure, which FCA and Renault blamed squarely on the French government, deprived both companies of an opportunity to create the world's third-biggest carmaker with 5 billion euros ($5.6 billion) in promised annual synergies. It also shone a harsh light on Renault's relations with Nissan, which have gone from frayed to fried since the November arrest of former alliance Chairman Carlos Ghosn, now awaiting trial in Japan on financial misconduct charges he denies.

REVIVAL TALKS

Italian-American FCA — whose brand stable encompasses Fiat runabouts, Jeep SUVs, RAM pickups, Alfa Romeo luxury cars and Maserati sports cars — has so far turned a deaf ear to suggestions by French officials that its merger proposal could be revisited. But since the breakdown, Elkann and his French counterpart Jean-Dominique Senard have had talks about reviving the plan that left the Renault chairman and his Chief Executive Thierry Bollore upbeat about that prospect, three alliance sources said. Renault and a spokesman for FCA declined to comment. One of Elkann's senior advisors on the Renault merger bid, Toby Myerson, was expected at Nissan headquarters in Yokohama on Monday for exploratory discussions with top management, two people with knowledge of the matter said. Nissan CEO Hiroto Saikawa is likely to attend. Myerson did not respond to a message from Reuters seeking comment. The meeting comes amid mounting strains that may preclude compromise, after Senard warned Saikawa that Renault was prepared to block key Nissan governance reforms in a dispute over board committees. Alternatively, the escalating tensions and negotiating positions could give way to a breakthrough, as FCA-Renault's industrial logic and savings prove hard to ignore.

REBALANCING ACT

Saikawa, who has argued consistently that alliance shareholdings need "rebalancing" to reflect Nissan's superior size, would press for a substantial reduction to Renault's stake as part of any agreement, according to the same people. Nissan's 15% stake in Renault carries no voting rights. "If FCA are expecting some sort of negotiation, they must be anticipating that request," said one. The FCA-Renault deal that Elkann whipped off the table — at least for now — would have seen both companies acquired by a listed Dutch holding company owned 50-50 by current FCA and Renault shareholders, after payment of a 2.5 billion euro special dividend to FCA shareholders. Paris had secured stronger job guarantees and terms including a cash payment to Renault shareholders, following public criticism that the bid undervalued Renault. For Nissan, however, the merger would "swap out one small 43% shareholder for a bigger 43% shareholder it doesn't know," said a source familiar with top management thinking. Nissan could back the FCA-Renault deal only with a "substantial reduction" in the French carmaker's holding, they said. France may not automatically oppose a reduction to the Nissan holding if it secured Renault's place at the heart of a consolidated group. The government has also said it could reduce its own 15% Renault holding, to the same end. "All options can be considered," Finance Minister Bruno Le Maire told Le Figaro after the deal collapsed, when asked about Japanese pressure for Renault to reduce its Nissan stake. But a senior ministry official declined to elaborate on that possibility. "The proposal is gone," he said. FCA may also be prepared to compromise for a tie-up that promises to plug the technology gaps threatening its ability to keep pace with vehicle electrification and emissions compliance. It has few other potential partners, after talks with Peugeot maker PSA ended inconclusively earlier this year. Estimated FCA-PSA synergies were closer to 3 billion euros, according to one person briefed on the matter. FCA has already floated a call option that would allow Nissan to increase its 7.5% voting stake in the combined FCA-Renault, another person involved in the talks said. Nonetheless, anything beyond a token reduction of Renault's Nissan stake would likely upset the deal valuations and prove unpalatable to its prospective merger partner. "It's not something FCA would want to reduce," the same person said. "It's an intrinsic part of the value of Renault." Elkann and Senard had planned to press ahead with a merger agreement and formal talks over Nissan's abstention, in the belief that the deal economics would compel it to follow and cooperate, sources close to the Renault board have said. By blocking that strategy at the eleventh hour, the French state may have handed the Japanese company a new negotiating opportunity. One thing Renault and Nissan can agree on is that any window to revive the merger is likely to be short. "If there's going to be a deal it will probably be in weeks rather than months," one alliance executive said.

(Reporting by Laurence Frost; Additional reporting by Norihiko Shirouzu in Beijing and Giulio Piovaccari in Milan; Editing by Richard Chang)

France Could Reduce Its Renault Stake To Solidify Partnership With Nissan

France could reduce its Renault stake to solidify partnership with Nissan

French Finance Minister Bruno Le Maire said France is ready to cut its stake in Renault in order to consolidate Renault's partnership with Nissan, Agence France Press (AFP) reports. Le Maire said Paris, which has a 15% stake in Renault, might consider reducing its stake, if it led to a "more solid" alliance between the Japanese and French firms, the French news agency reported, citing an interview with the minister. "We can reduce the state's stake in Renault's capital. This is not a problem as long as, at the end of the process, we have a more solid auto sector and a more solid alliance between the two great car manufacturers Nissan and Renault," he told AFP. Le Maire had earlier said the French government was open to tie-ups involving Renault as long as French industrial interests were protected, and would consider any Renault deal with Fiat Chrysler that respected the French firm's alliance with its Japanese partner Nissan. Fiat on Thursday abandoned its $35 billion merger offer for Renault, blaming French politics for scuttling what would have been a landmark deal to create the world's third-biggest automaker behind Japan's Toyota and Germany's Volkswagen. The French government had welcomed the merger plan, but overplayed its hand by pushing for a series of guarantees and concessions that eventually exhausted the patience of FCA, sources told Reuters. Renault and Nissan were not immediately available to respond to a request seeking comment. (Reporting by Mekhla Raina in Bengaluru; editing by Richard Pullin and Elaine Hardcastle)

Toshiba Regains Stake In Chip Jv To Pressure Western Digital

Toshiba regains stake in chip JV to pressure Western Digital

Toshiba Corp. has taken back a majority stake in a joint chip production venture with Western Digital Corp. from its chip unit which the Japanese conglomerate plans to sell off, after the U.S. company took legal action last month to block the sale, sources close to the matter said Wednesday.

Toshiba retook the 50.1 percent stake in the joint venture that it transferred to Toshiba Memory Corp. after it was spun off from the parent company. Western Digital owns the remainder.

Apple To Spend Billions To Acquire Stake In Toshiba's Memory Business

Apple To Spend Billions To Acquire Stake In Toshiba's Memory Business

A couple of weeks ago it was reported that Toshiba had announced that they would be selling off their memory chip business. While it was unclear who would be buying the company (or a stake in it), names such as Amazon, Google, and Apple was tossed around. Now it seems that in a separate report from NHK and Reuters (via MacRumors), Apple is eyeing a 20% stake.

The report claims that Apple is apparently eyeing to own at least a 20% stake in Toshiba's memory business, if not greater, and that the company could spend billions of dollars in order to achieve that. The reason for not completely buying out the company is because there is concern  by the Japanese government about a non-Japanese entity owning the company, which is why Apple plans for Toshiba to keep some shares so that there will be partial Japanese ownership.

Nissan’s Stake In Mitsubishi Could Mean New Lancer

Nissan’s stake in Mitsubishi could mean new LancerNissan Motor Co’s partial acquisition of Mitsubishi Motors could see the two groups co-develop their next-generation pickup ute models to drive down costs and share expertise.
Furthermore, Nissan’s newly appointed co-CEO Hiroto Saikawa has given a strong signal that Mitsubishi could use the Renault-Nissan alliance’s CMF modular architecture to revive the plans for new-generation passenger cars such as another Lancer.

Nissan Strengthens Alliance With Acquisition Of 34% Stake In Mitsubishi Motors

Nissan strengthens Alliance with acquisition of 34% stake in Mitsubishi MotorsNissan Motor Co., Ltd., ("Nissan") today completed its acquisition of a 34 percent equity stake in Mitsubishi Motors ("MMC") and became its largest shareholder.
MMC will also become part of the global Alliance with Nissan and Renault. With the addition of MMC, the Alliance will be in the world's top three automotive groups by global volumes, with sales of 10 million units in fiscal year 2016.

Epson Acquires 100% Stake In For.tex

Epson Acquires 100% Stake in For.TexEpson Italia S.p.A., an Epson Group company ("Epson", TSE:6724), has acquired For.Tex S.R.L., a leader in the textile printing industry. Epson Italia, which purchased a 50% stake in For.Tex in 2012, completed the buyout in a move that strengthens Epson's digital textile printing business.